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What is P.E.S.T?
Transcript of What is P.E.S.T?
• political stability- The more politically stable the country are the more sales apple should make as the public will have a higher consumer confidence.
Political factor gives a heavy influence to Apple Inc decision-making process as they have established many companies all over the world.
To reduce their operating cost Apple also spread their product manufacturing to different companies outside America. Cork, Ireland, Korea, China and Czech Republic are some of the other states where Apple placed their company. Bad international relations, wars, terrorism, and public health issues between U.S. and these states might give a negative impact that may damage the Apple Inc reputation as well as their business process.
What is P.E.S.T?
Technology for Apple
Apple need to keep up with the demands that the world and public is setting to improve and look into the future of technology but bring it to know. Everyone is always wanting the new gadgets.
The technological environment for Apple's market has grown a lot over past years. Most specifically, phones and computers have become a extremely popular and a necessity. Apple is on top of the market for innovating products and the main thing about these products is that their life cycles are very short, making it inevitable for more products to be sold later. The increase in technology is encouraging competitors to improve, which then keeps Apple improving.
Economic changes for apple
Depending on the amount of interest apple might make per year will determine the improvements they can make to their business and if they will design any new products. If they have a high interest then they can spend more on research and completely new things for the phone. If they are making an interest then the company will be suffering and will have to make big decisions into whether they want to expand and take risks in bringing out a new product.
Inflation, recession and currency are three important economic factors that Apple noticed
As Apple Inc. already go international the U.S. bad economy condition, which take a longer time to recover compare with other country will not be a problem anymore
Apple's products may be viewed by some as "luxury" products and a the inflation rate is high, while income is low and unemployment rates are increased the company could risk a severe loss in sales.
how political, legal and social factors have impacted on the organisation.
P.E.ST AND APPLE
To conclude I would say that apple is greatly affected by P.E.S.T. Depending on the business cycle is whether or not the sales are good, this is shown in P.E.S.T and the business.
Apple is a very well established company with a good understanding on all sections in a PEST analysis. Politically- by having a "plan B' in case something that they cannot control happens and it is still maintaining success while the depression is present, they are knowledgeable in economics. Apple uses the modern public to design their products as well as create new ingenuity. They seem to have all bases covered and will always be a leader in technology.
Social factors for apple
Social factors can be a big factor that could determine whether or not apple do well.
There are certain trends that people like to follow, luckily apple have built the reputation that normally set the trends.
For example they when they brought out the new iPhone 5, everyone had to have it. This is great for the business as it really makes all the money they put into making the phone worth it. This also increases their chances of profit.
They could also be under pressure of other phone companies such as Samsung and HTC copying their ideas so. This means they need to get their ideas out their first so the customers will go to them instead of the other competitive businesses.
Social trends for phones in more recent times would be the oversized phone, Samsung have released a range of these that have proved very popular with the public. More and more users are streaming TV and movies on the mobile and would rather surf the internet on their phone than their PC. It's obvious that a bigger screen is better suited for our modern user habits.
NetCom also reports that55% of the smartphones sold last month were Apple iPhones
For Apple their main way of social media is through facebook and twitter, they have pages for both sites, This is a great way of advertising as it these sites are used by millions of people and it also includes their target market.
Technology had become the most important media that makes this globalization developed faster and wider. The Virtual world that we can access to nowadays technology is used by Apple as a big business opportunity by developing many virtual media. Music market to cyberspace has big roles that influences people to use this virtual world.
Apple is globally seen as the best at technology, caused by their virtual media development and design improvement. The reputation of Apple also goes up and many people had started using it.
changes relate to changes in government influence and can have huge significance for companies. Changes in the priorities for public spending or the UK 's relationships with other countries can open or close major markets.
Political changes are closely tied up with legal changes. Laws are continually being updated in a wide range of areas.
changes are closely related to social ones. The economy goes through a series of fluctuations associated with general booms and slumps in economic activity. In a boom most businesses benefit and in a slump most lose out. Other economic changes that affect business include changes in the interest rate, wage rates, and the rate of inflation. Businesses will be more encouraged to expand and take risks when economic conditions are right, this is to try and increase popularity within the business to get a profit.
relate to pattern of behaviour, tastes, and lifestyles. A major component of this is a change in consumer behaviour resulting from changes in fashions and styles. The age structure of the population also alters over time. An understanding of social change gives business a better feel for the future market situation.
It will determine the rate of technological change. They can determine barriers to entry, minimum efficient production level and influence outsourcing decisions. Technological shifts can affect costs, quality, and lead to innovation.
Organisations need to be aware of the latest relevant technologies for their business and to surf the wave of change
Make justified recommendations for the development of business activities in the two different business environments (political, social or technological).
Political-laws are in different for apple in all the countries they are sold in. For example there has been a big article about the conditions emplyers are working in china. And that the phones and gadgets we all use are being produced in
'Employers work excessive overtime, in some cases seven days a week. and live in crowded dorms some say they stand so long that their legs swell until they can hardly walk. underage workers have helped build apples products and the company's suppliers have improperly disposed of hazardous waste and falsified records according to company reports and advocacy within china are often considered reliable independent monitors.
137 workers were also injured when they were ordered to use a poisonous chemical to clean the phones and it also killed 4 people.'
This is an issue apple need to address and change to ensure their staffs safety.
Social- For apple the social trend in technology is that they may have to adapt and stand out from is now most mobile phones are touch screen and have many of the same features, so to become market leader against their competition they need to make themselves different and come up with something that will excite potential and existing customers. Everyone wants a fast and easy phone to use so they need to take this into consideration. Also the use of the internet and social networking sites are being used more and more often so apple have looked into this and come up with a system that will allow people use the internet extremely fast, this is called 4G. This could encourage and persuade their customers to buy their phones from apple instead of somewhere else.
technological- This links in with the social aspects, apple are known for being ahead of other mobile and device companies so they need to always be looking into the future and coming up with things people are not expecting and will make them want to buy their products.
Apple has adapted their activities to suit different business environments. For example they will invent iphones that are of multi use. E.g. it will have features that are great for businesses and also good for families and for other intentions.
Activities that have been adapted because of:
Political- internet usage, content, never made sales to china, weird distribution network,
Legal- Some legal challenges that apple have had to battle with include the court case that was Apple accusing Samsung of copying the idea and making a new phone very similar to theirs, Samsung had to end up paying $1.05 billion to apple, but they payed it all in nickle coins. they won, Apple was also a part of an argument because they picked their name was already a record label, This record label signed the beatles so they were very well known and thought that apple had copied them. The two companies instead agreed to share the disputed trademark in completely separate markets: Apple Corps in the music business, and Apple Computer in the computer business.
When Apple started developing computers that made sounds, the company decided its 1981 agreement needed revisiting. Attempts at renegotiating in 1987-88 led nowhere, and Apple went on to release its first computers with Musical Digital Interface in 1989. Apple Corps snapped to attention, claiming a violation of the 1981 settlement. After another round in court, Apple Corps and Apple Computer reached a new settlement in 1991 with undisclosed terms.
Social- the models of their IPhone have been adapted due to social trends. they are being updated to fit with the demands of technology and social trends constantly improving.
Future changes in economic, political, legal and social factors may impact on the strategy of Apple